News Release

Resolutions include measures on cost-savings and access to Deferred Compensation program

Harrisburg, PA – Pennsylvania Treasurer Joe Torsella today praised the Pennsylvania State Employees’ Retirement System (SERS) for adopting a resolution that will provide a plan by the end of this year to reduce the total investment fees paid to external managers over a three-year period.

“I commend the SERS Board for supporting action that will save Pennsylvania taxpayer money and improve returns to the pension fund by reducing the amount of Wall Street fees paid by SERS. SERS has recently taken initial action to reduce fees. We need to go further, and reduce fees by 30% over the next three years. Adopting this resolution serves as a tremendous step forward in making SERS a national leader in fighting against outrageous fees.”

Pennsylvania Treasurer, Joe Torsella

Two other resolutions put forward by Torsella and adopted by the board direct SERS investment staff to identify opportunities for operational consolidation and contracting cost savings to present to the Board within six months; and to develop a plan to expand access to SERS’ Deferred Compensation program for all public employees of local governments throughout the Commonwealth in order to increase retirement savings opportunities.

The resolution comes after Governor Wolf and Treasurer Torsella sent a joint letter to the boards of SERS and PSERS to encourage them to reduce investment costs over three years and implement administrative efficiencies.

“For years, I have sought to reduce unnecessarily large Wall Street fees paid by Pennsylvania’s pension systems. Today’s news is welcome progress after Treasurer Torsella and I called for this action and the components of this year’s pension reform that set forth guidelines for reducing costs on Wall Street managers.”

Pennsylvania Governor, Tom Wolf

The Auditor General’s audit of SERS in August found that SERS paid $167 million on an annual basis to high-priced Wall Street money managers for an investment strategy that returned 6.5% in the most recent fiscal year.

Treasury has already taken the lead on lower-cost investing. Treasurer Torsella announced in April that he would transition all of Treasury’s $2.4 billion public equity investment holdings to a passive investment strategy, saving an estimated $5 million per year in fees (approximately $195 million in total savings when compounded over 20 years).